A statement was made by Peter Neupert, chairman and CEO of drugstore.com, explaining the matter to the press: We informed employees of staff reductions Friday, January 19th. I believe we can achieve our previously stated 2001 revenue goals with a smaller team and less spending on marketing. With today’s changes, drugstore.com will reduce planned operating expenses by $20 million for 2001, and decrease total headcount by approximately 125 positions, or approximately 20%of the total workforce. These steps put us on a plan to reach operating cash flow break even with the funds we have on hand.
Our strong fourth quarter 2000 results demonstrate that drugstore.com can grow the business while making our cash last longer. Over the previous six months, we significantly reduced expenses while still showing positive improvement on key metrics. From our perspective, the costcutting steps announced today are practical and appropriate actions in response to today’s market challenges.
We believe drugstore.com will be one of the dot coms that will survive and thrive. Our unrelenting focus on meeting the wants and needs of our customers and our willingness to make the swift, smart business decisions to build a long term profitable business demonstrate our staying power, he concluded.
